The new prime minister of the United Kingdom (UK) may be facing a possible trade war with the European Union (EU) over the Northern Ireland (NI) Protocol according to a report on the current race to become the new leader of the Conservative Party.
The report, written by UK In A Changing Europe, has analysed Lis Truss and Rishi Sunak on their policies on health, immigration and the economy.
On the matter of Brexit, the director of the research group, Anand Menon, said that looking further ahead, much will hinge on the Northern Ireland Protocol for the new prime minister.
Menon added that should the proposed Protocol Bill in the UK Parliament become law, the new government would face the prospect of “immediate retaliation” from the EU, “most probably via a further court action in addition to the two already underway”.
“This could prompt a trade war and would worsen already strained UK-EU relations.”
The report also stated that even if the Protocol Bill did not become law, the need to settle the dispute over the NI Protocol will “continue to dominate the relationship”.
Menon said that how the dispute over the NI Protocol is managed will have a huge bearing on any future cooperation between the UK and the EU.
He added that any further impacts to the UK economy “will only increase” in the event of any legal confrontation over the NI Protocol and could result in major trade disruption between the UK and the EU.